commercial real estate Archives | Page 3 of 3

Rising loan modifications signal mounting challenges for commercial real estate (CRE) lenders, as the traditional “extend-and-pretend” approach faces increasing limits. Modification Trends: Banks have significantly increased modifications on non-owner-occupied (NOO) CRE loans, with a 65-basis-point rise in the first nine months of 2024—a 35% jump since mid-year, according to Moody’s. Smaller banks led the charge…

The commercial real estate market appears poised for a resurgence as financing activity gains momentum ahead of 2025, signaling what some experts believe could be the most attractive investment environment in nearly two decades. Financing Makes a Comeback Following a pandemic-driven slowdown, the $22.5 trillion commercial real estate sector experienced a notable recovery in 2024,…

As office vacancies hit historic highs and property values continue to decline, developers are increasingly transforming underutilized office buildings into much-needed residential spaces. The big picture This trend addresses two pressing issues simultaneously: the record-high national office vacancy rate, which reached 19.2% in Q3 2024, and the housing shortage, which demands an additional 3.8 million…

Billions Raised, but Unspent Real estate funds that amassed significant capital post-pandemic in anticipation of distressed opportunities are finding fewer deals than expected. According to MSCI, the total value of distressed properties nationwide reached only $102.6 billion in Q3, falling short of the anticipated wave of distressed sales. Instead of foreclosures or asset sales, banks…

The New York Fed has raised concerns about the “extend-and-pretend” approach in regional banks’ commercial real estate (CRE) portfolios, warning that it may heighten financial instability. According to Bisnow, regional banks have been extending loan maturities rather than marking loans as distressed, contributing to a $400 billion surge in upcoming CRE loan maturities. This practice,…

Exterior of large building with 2 story condos

While many commercial real estate sectors face challenges, multifamily properties are experiencing renewed investor interest, driven by high mortgage rates and increasing single-family home prices. A Comeback Investor confidence in office, retail, and industrial real estate has waned, but multifamily is gaining momentum. According to Altus Group’s Q3 2024 U.S. CRE Survey, 69% of investors…